An art to solving Detroit's debt

Late last month, the Detroit Free Press ran a major article on a problem that seems unthinkable: the likelihood of the precious artworks in the Detroit Institute of the Arts being sold to help pay the crippling debts of the City of Detroit.

"It is an existential drama of a kind that no city has ever faced," reporters John Gallagher and Mark Stryker wrote, "a combination of a high-stakes poker game and morality play in front of a worldwide audience."

This situation in the troubled city a little less than 300 miles northeast of Chicago was caused by the confluence of two unusual circumstances. One is the takeover by the state of the horrific finances of the city of Detroit, which is staring down at least $15 billion in long-term debt that it has little likelihood of being able to pay. That led to the appointment of an emergency manager, Kevyn Orr, who is obligated to look for ways to raise cash and cut costs, and who might end up declaring what would be the biggest municipal bankruptcy in the history of the United States.

The second set of circumstances involves the ownership of the art, which includes works by Mark Rothko, Paul Cezanne, Vincent van Gogh, Georges Seurat, Andy Warhol and Henri Matisse. Both the Detroit Institute of the Arts and the works are technically owned by the city of Detroit, although the museum has a contract with the city to run the museum under the usual industry standards, which, of course, means exhibiting rather than selling the art. There has been some debate about the distinction between trusts and contracts, but even the museum has not questioned the city's basic right to sell, even if it is furious about the possibility of that right being enacted.

The art, which likely is worth billions of dollars in toto, is a colossal city asset (if that is what it is). For example, "The Wedding Dance," an oil painting by Pieter Bruegel the Elder, has been valued in media reports as worth between $100 million to $150 million. That's just one piece in the massive DIA collection. In fact, a recent article in Bloomberg Businessweek argued that the art at that DIA could be worth at least $15 billion, an amount roughly equivalent to the entire debt of the city. No wonder Orr was having to pay attention.

Over the last few days, outrage has been expressed by many heads of art museums in other cities. On Tuesday, a bill was approved by a Michigan Senate committee that seeks to protect the DIA art by amending state law to forbid the sale. The bill, introduced by a Republican, was expected to pass in the full Senate..

Whatever the outcome, the issue is, in so many ways, fascinating. It completely upends the usual notion that a city is the best possible guardian for a nonprofit cultural organization. Conventional wisdom has it that a city's cultural heritage is at its very safest in the hands of a city's people, acting through its elected representatives. Not in this case. In this case, a city's cultural heritage actually will need to be protected from the city's problems. And while no other city of a size anything close to that of Detroit is in a comparable circumstance, this should be enough to give pause to those on the boards of directors of any organization with a mission to preserve and protect.

The city of Chicago owns more than 700 artworks, including the famous untitled sculpture known as the Picasso and Alexander Calder's Flamingo. In the event of a city default, they'd presumably be vulnerable. The art inside the Art Institute of Chicago is, of course, not a city-owned entity, although the city of Chicago lists the lions that sit on its steps among its public artworks.

In some ways, the Detroit situation brings to mind the situation in Baghdad during the war in Iraq when a great deal of art was damaged or destroyed, much to the chagrin of international scholars. Governments can destroy art in any number of ways: through oppression of the people leading to war (those who opposed the war would consider the invaders similarly culpable) or simply through spending more than their revenue.

There is, of course, a counterargument. The city of Detroit has creditors, many of which are the oft-impoverished residents of that very city. If a city promises to pay a debt but finds it cannot, should it not sell what assets it has to try make partial good? And why should art be exempt? Artworks don't feed a child, and, even in the event of a sale, they would not be destroyed but merely dispersed. If art were not a commodity, there would not be such an explosively rich market. So if one takes a strictly libertarian argument here, the sale would be allowed to go ahead.

Last week it was noted that the city's collection of classic automobiles (owned through the Detroit Historical Museum) are similarly at risk. Should the same state protections apply to the concept vehicle known as the 1963 Ford Mustang II, which is also worth millions of dollars? It's an interesting question, especially since it's a fair bet that many residents of Detroit feel a greater spiritual link to a Ford Cougar II or a Chrysler Turbine than a piece of European art donated at death by a rich man with connections to the Fords themselves. And even if all museums get protections, what about the other cultural stuff that the city owns directly? Why not that?

One could continue on down the line of city assets: The very nature of most of a city's assets is that they mean something to someone that goes beyond money and plunges into the realm of history, culture, art, community.

The overarching tragedy here is what has been allowed to happen to Detroit itself: The artworks, which have powerful guardians who should and will prevail, are only a very privileged few of the victims.